The chairman of the US Federal Reserve Jerome Powell testifies during the hearing of the Committee for Financial Services regarding the “half -monthly monetary policy report of the Federal Reserve” at Capitol Hill in Washington June 24, 2025.
Saul Loeb AFP Getty images
Chairman of the Federal Reserve Jerome Powell On Tuesday, he emphasized the involvement of the central bank in maintaining inflation under control, saying that he expected that decision -makers would remain suspended until they have better coping with the impact on prices.
In the notes delivered to two congress committees This week, Powell characterized economic growth as strong, and the labor market was in full employment.
He noticed, however, that inflation is still above 2% of the Fed target, with the influence of the president Donald TrumpThe tariffs will still be unclear.
“Policy changes are still developing and their impact on the economy remains uncertain,” said Powell. “The impact of tariffs will depend, among others, on their final level.”
Power, repeating a familiar language from the head of the Fed, Powell said that decision -makers are “well prepared to wait to learn more about the likely course of the economy before considering any adaptations to our politics position.”
Careful shades can continue to antagonize Trump, which he has has increased his long -term criticism Powell. In its latest width, Posted on Tuesday on Tuesday On President's social platform, Trump said he hopes that “Congress really works on this very stupid, hard person.”
Powell presented his comments along with the FED monetary policy report, first to the House Financial Service Committee on Tuesday, and then he will appear in front of the Senate Banking Committee later.
House members have repeatedly asked Powell about cutting criteria, and consistently said that during the summer he would take data to provide evidence that tariffs would not provide long -term increase in inflation.
“We try to be careful and cautious,” he said. “We really think that this is the best thing we can do for the people we offer.”
Asked if the pressure from the White House of Trump had an impact on politics, Powell repeated the old claims that politics plays no role in the Fed.
“They have no effects,” he said about the president's attacks, which became more and more personal. “We do our work.”
Inflation observed drifting
Most of the speech was the language of boiler plates, which Powell used to describe the economy, which said “remains solid”, a word that also characterized the labor market.
However, in the case of inflation, he said that the preferred Fed measure would probably increase to 2.3% in May, with the basic measure excludes food and energy to 2.6%. Readings from April amounted to 2.1% and 2.5%.
The tariffs historically caused a one -off price increase and only sometimes they were responsible for long -term pressure on inflation. Powell said that he and his federal colleagues from the committee on the open market will weigh this balance and are not in a hurry to adapt the rules until they have more data to work this time. FOMC is a central bank arm.
“It is the duty of FOMC to maintain long-term expectations of inflation well anchored and preventing a one-off price level has become a continuous problem of inflation,” said Powell. He added that the FED will try to balance the double goals of full employment and low inflation, “remembering that without price stability we cannot achieve long periods of strong conditions of the labor market, which benefit to all Americans.”
Fomc he voted unanimously last week To maintain stable rates.
However, updating the future expectations of individual members – the “Dot Fout” network – the division into members showed. Nine out of 19 officials favored zero or one this year, and eight saw two cuts and two others expected three. The plot is anonymously, so it is not possible to learn the prospects of individual members.
However, over the past few days of two key FOMC voters, Governors Michelle Bowman and Christopher Waller have said that they were conducive to reducing in July, if the inflation data remain under control. The consumer price indicator increased in May only 0.1%, repeating other indicators showing muted pressure from the tariffs.
Futures market prices indicate only 23% likely to cut at the meeting on July 29-30, with a much greater probability of the next reduction in September, in accordance with the CME Group group Fedwatch gauge.